To ask the Secretary of State for Levelling Up, Housing and Communities, with reference to the Answer of 6 December 2021 to Question 85168 on Flats: Construction, what safeguards have been put in place to ensure that leaseholders do not have to pay for remedial works to apartment blocks caused by (a) faulty design and workmanship by contractors and (b) inadequate supervision by freeholders; whether he plans to introduce additional safeguards for leaseholders; if he will make an assessment of the implications for his policies on liability for remedial works of the use of ad hoc limited companies by contractors and freeholders to (i) carry out works and (ii) nominally take over ownership of such blocks after the completion of remedial work; and if he will make it his policy to require planning authorities that permit the construction of additional storeys to existing apartment blocks to conduct annual surveys on the (A) frequency of defective outcomes and (B) implications for existing leaseholders for their (1) costs, (2) property values and (3) quality of life.
The landmark Building Safety Act 2022 delivers robust and far-reaching protections for leaseholders in buildings above 11 metres in height or with at least five storeys from the costs associated with historical building safety defects. A leaseholder qualifies for the protections if, on 14 February 2022, the property was their principal home, or if they owned up to three UK properties in total.
The Act protects qualifying leaseholders from all costs related to the remediation of unsafe cladding and the costs for remediation of non-cladding defects and interim measures like waking watches are subject to a firm cap. Once the leaseholder caps have been reached, landlords will be unable to demand further non-cladding costs from leaseholders. Qualifying leaseholders will be protected from costs associated with both shoddy workmanship and faulty design: the protections safeguard against costs associated with any defect that has arisen in the past 30 years because of anything done or not done, or anything used or not used in connection with works to the building that also causes a building safety risk. This includes defects associated with the provision of professional services, for example those of an architect.
The Act ensures that corporate structures cannot be used to evade liability for building safety defects. Freeholders with links to the building’s original developer, such as where the freeholder is a subsidiary of the developer, will need to meet remediation costs for their buildings in full. As the Act looks at the situation on 14 February 2022, any future buyer of the freehold will assume the same liabilities of the previous freeholder; as such, freeholders will not be able to simply sell off their buildings to evade liability. The Act also grants a power to the High Court allowing them to extend specific liabilities for one company to associated companies, removing the protection afforded to developers and contractors by special purpose vehicles.
All development, whether allowed through a permitted development right or an application for planning permission, must meet building regulations including fire and other building safety requirements. The Government has no plans at present to review the permitted development rights for building upwards.